Energy Week Ahead: Sold-Out Hearings for EPA Climate Plan

July 28 (Bloomberg) -- The nation gets its chance this week
to blast or praise the Environmental Protection Agency’s
sweeping plan to cut climate-warming emissions by 2030.

Companies, environmental advocates and citizens will sound
off at EPA hearings starting tomorrow in Atlanta, Denver and
Washington about the 645-page proposal, unveiled two months ago,
to limit carbon-dioxide emissions from power plants. A two-day
hearing in Pittsburgh starts July 31. The agency says more than
1,600 people are scheduled to speak and by last week all slots
were filled in Atlanta, Denver and Washington.

About 300,000 comments already have been submitted on the
power-plant rule, with weeks to go before the deadline. And 683
businesses and nonprofit groups registered to lobby the EPA this
year, more than any other federal department, the Center for
Responsive Politics reported.

“This is the main event for climate action in this
administration,” Vicki Arroyo, executive director of the
Georgetown Climate Center, said in an interview. “EPA actually
crafted it to be a very broad approach, and so that brings in a
large number of actors.”

Analysts say the plan could cut coal use by almost half,
while boosting power generated from natural gas, nuclear plants
and renewable energy. Environmental advocates say such a shift
is long overdue. Many business lobbyists say the change could
cause electricity prices to rise and damage fledgling
industries. That fight flared last week in anticipation of this
week’s public hearings.

Economic Threat

Business groups appealed to EPA Administrator Gina McCarthy
to scrap the plan, saying it goes beyond what’s allowed by law
and requires fossil-fuel plants to seek reductions from other
sources, like getting customers to curb their power demand.

“It is clear that the rule presents a significant threat
to American jobs and the economy,” the U.S. Chamber of
Commerce, National Association of Manufacturers and dozens of
other groups wrote in a letter to McCarthy. “We therefore urge
EPA to go back to the drawing board on this rule.”

McCarthy dismissed those warnings today, and pledged to sit
down with states and utilities to help work through the EPA’s
plan.

“We know the purpose of this rule is so important, and
that’s why we’ve been so focused on the process,” McCarthy told
reporters on a call to discuss the series of hearings.

Damage Estimates

Before the plan was issued, the Chamber released an
estimate of the damage the economy, saying the rule’s cost could
be $50 billion a year. That estimate was challenged by the EPA
because it wasn’t based on any plan from the agency. Now that
the proposal is out, the group says it would be too difficult to
analyze the actual proposal because the EPA set targets state by
state.

“It would require 49 different models,” said Karen
Harbert, the head of the Chamber’s energy institute. (Vermont
has no fossil-fuel power plants, and so no required reductions.)

About 3,000 coal miners, vendors and coal-town residents
say they will rally across the river from the Pittsburgh meeting
site, trying to stop a rule they call EPA’s “most devastating
yet.”

On the other side, environmental and health groups are
organizing hundreds of supporters to testify, and are airing
television advertisements in the four cities that call the
Chamber’s economic estimate “fiction.”

‘Biggest Step’

“This shows that the polluters and their allies are
desperate,” Gene Karpinski, president of the League of
Conservation Voters, said in a telephone briefing. The EPA plan
“is the single biggest step that the government has taken to
reduce carbon pollution.”

Karpinski said that more than 4 million people submitted
comments on a separate EPA proposal covering new power plants,
and said he and his allies also would be rounding up support for
the proposal on existing plants. Separately, a radio
advertisement from the consumer group Public Citizen will target
Murray Energy Corp., the Pepper Pike, Ohio-based coal producer
that filed suit to stop the EPA in its tracks.

To be sure, both supporters and critics have their own
ideas for changes. Environmental groups want deadlines tightened
so emissions are cut sooner, and think states can ramp up use of
renewable power and energy efficiency more effectively than the
agency had predicted.

Goal Setting

It “is a very good and historic start. But it can, and
should, set more ambitious carbon-reduction goals,” Ed Chen, a
spokesman for the Natural Resources Defense Council, said in an
e-mail. The “standards significantly underestimate the carbon-reduction contributions by energy efficiency, solar and wind
power as clean replacements for dirty, retiring coal plants.”

Industry groups say EPA’s calculations may inadvertently
harm nuclear plants, which emit zero carbon, and in some cases
call on shuttered natural-gas plants to replace coal. Also, the
EPA both assumes coal plants will be more efficient and run
less, which would make them less efficient.

The June 2 proposal from the EPA sets standards for each
state based on the carbon from their coal and gas-fired power
plants, and then used a formula based on available natural-gas
capacity, renewables use and energy use cuts to set state goals
for cuts by 2030. Those cuts start to phase in in 2020.

Because emissions from power plants fell about 15 percent
from 2005 through last year, actual reductions are much smaller.
The EPA said it would lead to $90 billion in climate and health
benefits, and cost utilities as much as $8.8 billion.

And, not every business group opposes the plan. Business
Forward, which represents companies such as Cheniere Energy
Inc., Ford Motor Co., Google Inc. and Pacific Gas & Electric
Co., hosted a call with McCarthy July 24 to rally support for
combating climate change.

Inaction on dealing with climate change is an economic
threat at the moment, and the plan can be a benefit to the
economy, McCarthy told them.

“Businesses are paying the brunt of a changing climate,”
McCarthy told the business group. “We can turn these climate
risks into real opportunities.”